Nancy MacLean: Democracy in Chains: The Deep History of the Radical Right's Stealth Plan for Americahttp://amzn.to/2voi3qD: "As 1956 drew to a close, Colgate Whitehead Darden Jr., the president of the University of Virginia, feared...

Today's Economic History: Would I be out-of-turn to point out that these thesis statements by E.P. Thompson from his The Making of the English Working Class are, well, pretty much completely wrong? That there was no English working class in any Marxian sense of what a self-conscious class is that had been "made" by 1832? That there is almost no commonality between the working class of England as it stood in, say, 1926 and what there was in 1832?

Live from the Orange-Haired Baboon Cage: Josh Marshall: On Twitter: Bannon: "Journalists will sometimes, I think rightly, give someone the benefit of the doubt if they have no experience with the ground rules of... https://twitter.com/joshtpm/status/898006344908910593

Fabio Ghironi: Macro Needs Micro: "An emerging consensus on the future of macroeconomics views the incorporation of a role for financial intermediation, labor market frictions, and household heterogeneity in the presence of uninsurable unemployment risk as key needed extensions to the benchmark macro framework... http://faculty.washington.edu/ghiro/GhiroFuture.pdf

Nancy MacLean: Democracy in Chains: The Deep History of the Radical Right's Stealth Plan for Americahttp://amzn.to/2voi3qD: "As 1956 drew to a close, Colgate Whitehead Darden Jr., the president of the University of Virginia, feared...

Live from Post-Civil War: In some ways, the "good" Robert E. Leehttps://twitter.com/de1ong/status/897899627252285440 was a con game the post-Civil War North ran on the South: unlike the evil terrorist Nathan Bedford Forrest, Robert E. Lee surrendered when he lost, accepted the verdict of history, and turned to work building up the nation as head of Washington College.

Live from America's Better Self: Orientation Dayhttps://twitter.com/delong/status/897880320250322944: Yesterday we had 750 groups of about 20 people each following standards around the campus: The Berkeley freshmen are here. Young, smart very idealistic, many very upwardly mobile, somewhat scared, very excited—at the prospect of being no longer children but themselves, and grown-ups.

Note to Self: "Data Science" as an Ephemeral Term:There was a time—perhaps a century, maybe a bit more, certainly not much less—ago, when the high-tech bleeding edge electricity sector was an important but discrete part of the "economy".

Hoisted from 2001: Information Technology and the Future of Society (My Bekeley CITRIS Kickoff Talk)http://www.j-bradford-delong.net/TotW/citris_kickoff.html: For perhaps 9000 years after the beginnings of agriculture the overwhelming proportion of human work lives were spent making things: growing crops, shearing sheep, spinning yarn, weaving cloth, throwing pots, cutting down trees, copying books, and so on, and so forth.

My own feelings... were sad and depressed. I felt like anything rather than rejoicing at the downfall of a foe who had fought so long and valiantly, and had suffered so much for a cause, though that cause was, I believe, one of the worst for which a people ever fought, and one for which there was the least excuse...

Ogged: Google Anti-Diversity Memo: "I tried to read the Google anti-diversity memo, I really did. I even powered through the part where he said that deprecating products too quickly is an example of a leftist failing, but I just couldn't do it. If you'd like to discuss how you, too, couldn't make it through the whole thing, this is the thread for you..." http://www.unfogged.com/archives/week_2017_08_06.html#016132

The cold. The mud. The bleak wonder.
The weakening sickness--the weevils tainting the bread--
We were beaten again in spite of all we could do.
We don't know what went wrong but something went wrong.
When will we find a man who can really lead us?
When will we not be wasted without success?

The horses, burning-hooved, drove on toward the sea,
But, where they had passed, the air was troubled and sick
Like earth that the shoulder of earthquake heavily stirs.
There was a whisper moving that air all night,
A whisper that cried and whimpered about the house
Where John Brown prayed to his God, by his narrow bed.

Looking back another decade: By August 8, 2007 I had an idea of what was going down:

The Odds of Economic Meltdown: Hoisted from the Archives from Ten Years Agohttp://www.bradford-delong.com/2016/08/the-odds-of-economic-meltdown-saloncom.html: Hoisted from the Archives from Ten Years Ago: Pretty good, no?: "The past 24 years have been an amazing run as far as the business cycle is concerned. There have been only two recessions, and both of those were short and shallow. But Ben Bernanke and Co. are now at real risk of presiding over the third..."

Must-Read: Back before 2008, too much conventional wisdom held that the state of the business cycle did not matter much for the standard of living of those who did not own much capital. If inflation was to remain constant over time, a high-pressure economy that pushed inflation up had to be offset by an equal and opposite low-pressure economy that pushed inflation down, and so there was no permanent first-order gain for the working class from working hard to try to improve stabilization policy performance. This was, I think, always false. But now it is obviously false. It now seems very unlikely we will get any rapid growth of potential output without a high pressure economy. And, as Larry says: "Tight labour markets are the best social program": Lawrence Summers: The Progressive Case for Pro-Growth Policies

John Berry on the Fed's Decisions This Weekhttp://www.bradford-delong.com/2007/08/john-berry-on-t.html: He writes, for Bloomberg: "The Federal Open Market Committee will keep its overnight lending rate target at 5.25 percent and say its 'predominant policy concern' is that inflation may not moderate...

...Among the most striking aspects of Donald Trump is how, as president, he has taken the pathologies and dysfunctions of the modern Republican Party and brought them careening to their logical conclusions. The racial dog-whistling of Republican campaigns since Richard Nixon becomes outright racism in the hands of the Trump; the contempt for expertise seen from the party’s right-wing base becomes an administration staffed with amateurs and apparatchiks. And now, as the president’s approval sinks to new lows, what was once Karl Rove’s disdain for the “reality-based community” has inevitably given way to a president who chooses to disregard reality altogether, living instead in his own private Idaho where he is beloved and successful.

Weekend Reading: Paul Romer (2016): The Trouble with Macroeconomicshttps://paulromer.net/wp-content/uploads/2016/09/WP-Trouble.pdf: "Abstract: For more than three decades, macroeconomics has gone backwards. The treatment of identification now is no more credible than in the early 1970s but escapes challenge because it is so much more opaque. Macroeconomic theorists dismiss mere facts by feigning an obtuse ignorance about such simple assertions as 'tight monetary policy can cause a recession'. Their models attribute fluctuations in aggregate variables to imaginary causal forces that are not influenced by the action that any person takes. A parallel with string theory from physics hints at a general failure mode of science that is triggered when respect for highly regarded leaders evolves into a deference to authority that displaces objective fact from its position as the ultimate determinant of scientific truth.

Should-Read: I have never found "power" to be an illuminating and useful word in economics: "threat points", "default outcomes", "bargaining strategies", etc., IMHO, are much more useful ways of thinking about issues. You get somewhere if you ask the question: Why aren't employers today finding that they must offer higher wage increases to retain and attract the workforce they need? You don't get much of anywhere if you say: Workers just don't have the power to make big wage demands.

Should-Read: Guillermo Gallacher: Manufacturing employment, trade and structural change: "Calls for a return of manufacturing jobs... how feasible is such a goal in light of structural changes in the U.S. economy?... http://equitablegrowth.org/person/guillermo-gallacher/

Felix Salmon starts to see the train coming: Felix Salmon on Noise--Literally: Noise--Tradershttp://www.bradford-delong.com/2007/07/felix-salmon-on.html: He watches Jim Cramer, and is scared: "Great Moments in Punditry: Jim Cramer on Housing: Is it worth responding to this as though it's rational? Is this what passes for informed commentary on TV these days? I can see how it gets ratings, in a train-wreck kind of way–hell, I'm blogging it. But the idea that wealthy people will stop paying their mortgages because their houses are 'fungible' (unless we get a 100bp cut in the Fed funds rate, of course)–it's like some kind of incredibly unfunny parody. Nouriel Roubini et al might be shrill, but at least there's coherent logic to their position. What scares me is that this could be a rare and genuine glimpse into how traders actually think. In which case the Great Moderation and decline in volatility of recent years is doomed to die a sudden and extremely unpleasant death..."

No, Fox News has always been a slough of iniquity. Why do you ask?: Why Oh Why Can't We Have a Better Press Corps? (Bill O'Reilly Edition)http://www.bradford-delong.com/2007/07/why-oh-why-ca-8.html: Atrios tells us that it is Felafel Day, and provides quotes from noted Fox News journalist Bill O'Reilly: "If any woman ever breathed a word I'll make her pay so dearly that she'll wish she'd never been born. I'll rake her through the mud, bring up things in her life and make her so miserable that she'll be destroyed. And besides, she wouldn't be able to afford the lawyers I can or endure it financially as long as I can. And nobody would believe her, it'd be her word against mine and who are they going to believe? Me or some unstable woman making outrageous accusations. They'd see her as some psycho, someone unstable. Besides, I'd never make the mistake of picking unstable crazy girls like that.... If you cross FOX NEWS CHANNEL, it's not just me, it's [FOX President] Roger Ailes who will go after you. I'm the street guy out front making loud noises about the issues, but Ailes operates behind the scenes, strategizes and makes things happen so that one day BAM! The person gets what's coming to them but never sees it coming. Look at Al Franken, one day he's going to get a knock on his door and life as he's known it will change forever. That day will happen, trust me."

Should-Read: Fabio Ghironi: Micro Needs Macro: "An emerging consensus on the future of macroeconomics views the incorporation of a role for financial intermediation, labor market frictions, and household heterogeneity in the presence of uninsurable unemployment risk as key needed extensions to the benchmark macro framework... http://faculty.washington.edu/ghiro/GhiroFuture.pdf

Should-Read: Nancy MacLean: Democracy in Chains: The Deep History of the Radical Right's Stealth Plan for Americahttp://amzn.to/2voi3qD: "As 1956 drew to a close, Colgate Whitehead Darden Jr., the president of the University of Virginia, feared...

And, J.W. Mason, please don't say that Coibion et al.'s state-of-the-art potential output estimate "gives a very similar estimate for the output gap as simply looking at the pre-2008 forecasts or extrapolating from the pre-2008 trend". That's not the way to gain a reputation—at least, not they way to get any reputation that you would like to have.

The Blanchard-Quah concept potential output estimates being made by Coibion, Gorodnichenko, and Ulate http://delong.typepad.com/w23580.pdf do not look to me "very similar estimate for the output gap as simply looking at the pre-2008 forecasts or extrapolating from the pre-2008 trend". Look at the gap between the current estimate—the purple line—and the red or dot-dash green line that are the 2007 and 2009 vintage BQ forecasts. Look at the thick blue line that is (my drawing) of the upper hull of real output in this millennium a la Menzie Chinn:

Yes, BQ gives a large current output gap. No, BQ as applied by Coibion et al. does not give a "very similar estimate for the output gap as simply looking at the pre-2008 forecasts or extrapolating from the pre-2008 trend". You should not say it does.

Must-Read: Is "Audit the Fed" like creating the CBO, or like trying to destroy the CBO? Does the Federal Reserve need more oversight from the Congress, or less?

Shades of the Mytilene and Syracuse debates: with respect to the Federal Reserve, is Congress best seen as (a) a useful oversight body, or (b) a source of chaos and policy disaster that should be kept far away from a closed guild of hermetic monetary technocrats?

The very smart Peter Conti-Brown weighs in, tentatively, in favor of (b):

Must-Read: It still boggles my mind that the Federal Reserve did not move ten years ago today to set up a Subprime Mortgage and Home Equity Resolution Authority. Ben Bernanke! If there were one person who ought to have understood the need to be prepared, it would have been Ben Bernanke! And yet he showed no signs of understanding what the fan of possible futures he was then facing happened to be.

And, no, it is not appropriate for a central bank to wait for the political branches to act before it undertakes its lender-of-last-resort mission...

Ogged: Google Anti-Diversity Memo: "I tried to read the Google anti-diversity memo, I really did. I even powered through the part where he said that deprecating products too quickly is an example of a leftist failing, but I just couldn't do it. If you'd like to discuss how you, too, couldn't make it through the whole thing, this is the thread for you..." http://www.unfogged.com/archives/week_2017_08_06.html#016132

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We Are with Her!

Looking Forward to Four Years During Which Most if Not All of America's Potential for Human Progress Is Likely to Be Wasted

With each passing day Donald Trump looks more and more like Silvio Berlusconi: bunga-bunga governance, with a number of unlikely and unforeseen disasters and a major drag on the country--except in states where his policies are neutralized.

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Blogging: What to Expect Here

The purpose of this weblog is to be the best possible portal into what I am thinking, what I am reading, what I think about what I am reading, and what other smart people think about what I am reading...

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